If you're reading this its because you don't know what a reverse mortgage can do for you. You're doing research for yourself or a family member and when you put the term reverse mortgage into the Google search engine, you found this site as a reference and opinion site, not affiliated with a lender or association. You're going to get the truth here, no sugar coating and of course its pro-reverse but you'll also find comments on when its not a good idea to get a reverse mortgage.

OK, so here's the secret about what a reverse mortgage can do for you or your family member- it will increase their monthly cash flow. That's it, that's the secret, cash is king and if you are short cash flow and a homeowner over 62 the reverse mortgage can be your friend. If you have cash but need access to more cash, the reverse mortgage can be your friend. No credit or income requirements to qualify, you need to be 62 and have sufficient equity in your home and the older you are, the more cash you can access.

If you are on fixed income and struggling with cash flow, even slightly. Regardless of what you have heard about reverse mortgages, if you are over 70 and still making mortgage payments on your mortgage, there's really no reason for it. Possible exception would be if your home will be paid off in the next couple of years, your monthly payments to your lender are not giving you enough future equity to make more of a difference than the shortage of cash flow you are experiencing. Why do we say if you are older than 70? If you're still in your 60's and working, you still have cash to add to your bottom line, so you may not yet need to stop the leakage. The principle and interest payments you are paying into the lender adds up so fast that you're not going to recoup that net principle reduction in the next five years of a real estate market we are experiencing. Folks want to be mortgage free by retirement age and unfortunately the real estate market appreciated so fast that it was too enticing to not pay down other higher interest debt with the increase in home value. Don't think you're the only one that did that, over half of retirees are still making monthly mortgage payments. 70% of the reverse mortgages done are paying off an existing regular mortgage, all in the spirit of increasing monthly cash flow. Since a reverse mortgage does not require any payments for as long as the last remaining homeowner lives in the home, the notion of no payment at all is a welcome offering for someone on a fixed income.

Why wouldn't you want a reverse mortgage? If you are planning to move in the next year or two, there may be less expensive ways, like a HELOC or personal loan from a family member. If your plan is to make sure that all the kids get as much of your estate as possible upon your passing, unless you've got a big life insurance policy that provides that boost, a reverse mortgage is probably not in your best interests unless you need the cash absolutely right now. If you want to look at increasing what your estate can get upon your passing, look at this while you are still in your 60?s and can qualify for a decent life insurance policy. Perhaps the monthly reverse mortgage proceeds will cover that premium and provide you with cash flow relief, then you can get the reverse mortgage and afford a policy that will more than compensate for the home's value. Hence, the kids get more than the home was worth and its all good for everyone involved. A win win if you will.